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Some of the Problems Facing Cryptocurrencies

by hotshed71

Whenever a new technology makes its debut, it is reasonable to expect that it will face its own fair share of challenges as it tries to carve out a space for itself in its brave new world.

With the cryptocurrency industry, these challenges are rather amplified, as a result of the fact that the industry targets some pretty heavyweight industries like the Banking sector, who will not give up their favored position without a fight. And although the crypto industry has shown a pretty great resilience so far when it comes to the challenges it has been able to sidestep from external sources, it is its internal problems that prove much more worrying. Some of these problems include.

The cryptocurrency universe is an area of modern business which is seen by the majority of people as been too heavy laden with technical jargons that only a very few people truly understand. There are only an estimated 0.003% of the world population that truly understand the inner workings of the blockchain technology which is the engine that powers cryptocurrencies, and naturally investors fear what they don’t know. This lack of familiarity continues to bug down the rise and further growth of the cryptocurrency industry. And despite the fact that the industry is now worth well over half a trillion dollars, it only represents a fraction of what it can truly become.

Another key problem the cryptocurrency industry continues to grapple with is the fact that it is a highly volatile sector that is very much prone to exhibiting unpredictable behavior. Investors in stock markets, Forex and other well-known sectors of business are very much used to dealing with assets with known patterns and whose fluctuation in value does not resemble that of a rollercoaster, going high one second and then crashing down dozens of percents a few minutes later. Cryptocurrencies are still fairly new in the world of business and the speculation about prices of digital assets is what continues to drives its volatility problem in the markets.

Lack of Regulation
The cryptocurrency world is one that is very proud of its individuality and holds its freedom very dear. Being the pariah that has so far defied any kind of government intervention or supervision is among the key things that attract many into using cryptocurrencies. But for those who are looking for long-term investment options, the virtually zero level of oversight is among the things that scare off many more investors. From exchanges to ICO, there is little or no accountability or legal recourse for investors in case a major problem happens. Despite the huge opportunity of making massive profits within very short periods, the lack of regulation and insurance makes cryptocurrencies a no-go area for most institutional investors

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